Darshan Kumar Bansal vs Debts Recovery Tribunal Lucknow And Ors

Justice R. D. Khare, Chairperson

The present appeal has been preferred by the appellant under section 20 of the Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (in short “the RDDBFI Act”) against the judgment dated 07.05.2018 passed by the DRT, Lucknow, whereby the O.A. No. 841/2014 filed by the respondent no. 2-Bank was allowed.

The factual matrix of the present matter is that the respondent No. 2-Bank granted certain credit facilities to the respondent No. 3 and 4. In order to secure the loan, the respondent No. 2 and 3 created an equitable mortgage over their immovable property by depositing the title deeds with the respondent bank. In addition to the same, the appellant, who was also defendant no. 3 in the O.A., stood as guarantor to the said credit facilities advanced to the respondents no 3 and 4 (defendant No. 2 and 3 in the O.A) by creating mortgage over his immovable property and deposited the title deed and executed and signed various loan documents. The borrowers did not adhere to the terms of the loan agreements, therefore, the accounts were classified as NPA on 30/09/2014. Since the borrowers did not pay any amount, therefore the respondent-bank filed an Original Application No. 841/2014 before the Tribunal below for recovery of Rs. 44,83,656.00 along with pendentelite and future interest against the respondents no. 3 & 4 including the appellant (defendants No. 1 to 3 in OA).

It transpires that thereafter, the respondent-Bank issued a demand notice dated 22.03.2015 under section 13(2) of the SARFAESI Act followed by the possession notice dated 02.07.2015 under section 13(4) of the said Act. Subsequently, the Bank obtained an order dated 10.04.2015 from the D.M. under section 14 of the SARFAESI Act. The appellant filed a writ petition No. 4559/2015 before the Hon’ble High Court challenging the steps taken by the Bank, which was dismissed vide order dated 29.01.2015 on the ground of alternative remedy. Consequently, the S.A. No. 487/2015 was filed by the appellant, which was also dismissed vide order dated 07.09.2015 on the ground of delay. The said order was challenged by the appellant by filing writ petition no. 54719/2015 before the Hon’ble High Court, which was also dismissed vide order dated 23.09.2015 on the ground of alternative remedy. Consequently, the Appeal No. 263/2015 was filed before this Tribunal, but the same was dismissed as not maintainable for want of pre-deposit. Thereafter, a Suit bearing No. 1473/2015 has been filed by the appellant before the Court of Civil Judge (S.D.), Ghaziabad, but no relief has yet been granted to the appellant.

Thereafter, the Tribunal below vide impugned order dated 07/05/2018 decreed the O.A. filed by the respondent-Bank in toto against the defendants including the appellant. Being aggrieved by the said order, the appellant preferred a writ petition No. 18979/2018 before the Hon’ble Allahabad High Court, Lucknow Bench, Lucknow, which was disposed off vide order dated 04/07/2018 on the ground of alternative remedy and by making certain observations regarding fraud committed by the Bank officials against the appellant. Accordingly, the present appeal has been filed by the appellant before this Tribunal.

Learned counsel for the appellant submitted that the appellant is a teacher of Junior High School at Modinagar, District-Ghaziabad and also a resident of Modinagar, who had applied for a loan of Rs. 25.00 lacs to the respondent-Bank to meet his own domestic needs, but a Car loan and Cash Credit Limit were sanctioned by the respondent-Bank to the borrowers-respondents no. 3 & 4, for which the appellant has been shown to be a guarantor, whereas the said respondents run the industry at Delhi and they are not known to the appellant. The cash credit limit sanctioned earlier was enhanced from Rs. 10.00 lacs to Rs. 38.00 lacs prior to the date, on which the appellant had applied for personal loan. It is further contended that the guarantee loan has not been signed by the appellant to the said loans, for which the appellant has been shown to be a guarantor. It is also contended that date has been mentioned in the guarantee form only to save the Bank.

Learned counsel for the respondent-Bank contended that the appellant has executed and signed the guarantee agreements to the loans of the respondents no. 3 & 4. Copies of the said agreements have been appended as Annexures No. 1 to 4 of the reply of the Bank. Learned counsel further contended that all the proceedings, which were drawn against the appellant, have not gone in favour of the appellant till date. The next contention is that after submitting the title deed, the appellant did not approach the Bank for disbursement of the loan and remained silent for nine months. The appellant started to raise all such objection only when the notice dated 13.01.2014 was given and received to him 18.01.2014.

In the rejoinder, the learned counsel for the appellant submitted that the appellant did not remain silent for nine months as the appellant resides at Ghaziabad and the respondent-bank is situated at District Gautam Budh Nagar, therefore, the appellant could not contact the Bank. The next contention is that after lodging the FIR on 01.11.2014, the Bank had filed original application before the Tribunal below.

Learned counsel for the respondent-bank contended that the papers filed from the page no. 137 to 139 of the memo of appeal are the statement, which is only profile of the guarantor and the same are not required to be signed by the guarantor, therefore, the date and place has not been mentioned as pointed out by the counsel for the appellant. The signature of the guarantor is only required on the guarantee form.

Learned counsel for the respondent-Bank also submitted that the appellant is an educated person being a teacher and has executed and signed the various loan documents as well as deposited the sale deed of his dwelling house with the Bank, therefore, it cannot be said that the Bank has got all the loan documents signed by the appellant fraudulently. Hence the appeal filed by the appellant may be dismissed with heavy cost.

In the last, the learned counsel for the appellant canvassed that the respondent-Bank obtained the original sale deed of his dwelling house situated at Modinagar and documents of other property and also obtained his signatures on various blank loan documents assuring that his loan amount shall be disbursed shortly. After lapse of a long time, when the respondent-Bank had neither disbursed the loan nor informed anything about the same, the appellant lodged the FIR on 01.11.2014 with the concerned Police Station against the Bank officials including the then Branch Manager, Mr. Mahesh Verma, Shri Shailesh Kumar Sharma, Anil Kumar and Rajeev Kumar Pandey, in which the charge-sheet has already been filed by the police authority before the concerned Court and the trial is going-on. Hence, the leaned counsel has prayed that since the appellant has been made guarantor fraudulently by the Bank with the connivance of the said brokers to the loans of the respondents no. 3 & 4, therefore, the order impugned against the appellant may be quashed absolving the appellant from his alleged liability.

Despite service of notice, no one has appeared on behalf of the respondents no. 3 & 4-borrowers, as they were proceeded ex-parte before the Tribunal below also.

Having heard the learned counsel for the parties and considering the material available on record, it is undisputed that the loan facilities were advanced to the respondents No. 3 and 4 by the respondent No. 2-Bank and the various loan documents were allegedly executed and signed by the appellant. The main dispute in the present case is that the appellant had applied for the personal loan of Rs. 25.00 lacs with the respondent-Bank, but the contention of the appellant is that by playing fraud by the then manager of the respondent-Bank, the documents submitted by the appellant for his personal loan has been utilized for the purpose of the guarantee to the loans advanced by the Bank to the respondents No. 3 and 4 while the appellant has never given any guarantee to the said loans, but the Tribunal below has held the appellant liable for the liability of the borrowers. In this regard, the appellant had already lodged an FIR on 01/11/2014, in which the charge sheet has also been filed by the police authority before the competent court and the trial is going on.

It appears that after passing the judgment and decree impugned in the present case, the appellant filed a writ no. 18979/2018 before the Honorable High Court Allahabad, Lucknow bench, Lucknow, which was dismissed on the ground of alternative vide order dt. 04/07/2018 observing that this Appellate Tribunal while considering the appeal will look into the pleas taken by the petitioner in writ petition as well as in the appeal. Therefore, for the ends of justice, it is necessary to deal with/examine the process adopted by the Bank during advancing the loans to the borrowers.

The appellant was having a pre loan with the Allahabad Bank, which was ultimately settled and the original Title Deed deposited by the appellant in the said loan account was released on 07/02/2013, which is evident from the letter dated 11/09/2015 issued by the Allahabad Bank.

The respondents-Borrowers had applied with the respondent bank for a car loan of Rs. 4.95 lacs vide application Dt. 10/01/2013, in which no guarantee was offered by the borrowers, but the respondent bank has shown the appellant to be a guarantor for the same, whereas generally, in the vehicle loan, neither the bank demands the guarantee nor the guarantee is required. It is to be seen that the Car loan was applied on 10/01/2013 and the same was sanctioned on the very same day, and the alleged guarantee document/agreement was executed and signed by the appellant on 13/01/2013, whereas the property shown to be mortgaged in the said account was already mortgaged with the Allahabad Bank. The Bank has not produced any sanction letter duly acknowledged by the appellant either before the Tribunal below or before this Appellate Tribunal. Further, in Para 11 of the letter Dt. 07/11/2015 (at Pg No. 180 of the Memo), addressed to SHO, Police Station, Noida, the Bank itself has admitted that the guarantee in the Car loan is not required, but the appellant has given the guarantee in the CC loan advanced to the M.M Industries of the respondent No. 3, therefore, the said guarantee was extended to the car loan of the borrower also, which was sanctioned prior to it. It is observed that The Tribunal below has not given any finding on these facts in its order impugned.

With regard to the NPA, it is stated that the respondent Bank has mentioned the date of NPA as 30/09/2014 in the 4th Para of the O.A. (at pg No. 91 of the Memo), whereas in the Legal notice dated 13/01/2014, the Bank has stated the date of NPA as 31/12/2013, which is also required to be looked into.

So far as the alleged guarantee given by the appellant to the Cash Credit limit of M.M Industries, proprietor of which is respondent no. 3, is concerned, it is relevant to state that the borrower had applied for loan of Rs. 38 lacs on 04/02/2013, in which the property of the appellant situated at House No. 11, Gali No 7, Indrapuri, Bhupendrapuri, Modinagar, Ghaziabad was offered as security showing the valuation of Rs. 47.86 lacs vide loan application dated 04/02/2013 and the same was sanctioned and the loan documents were allegedly executed and signed by the appellant on 07/02/2013, as also created equitable mortgage over his property by depositing the original Title Deed with the respondent bank, but it appears that the bank has not produced any sanction letter duly acknowledged by the appellant nor produce any document with regard to the stamp duty, whether it is paid or not at the time of creating the equitable mortgage. It is to be seen that if the requisite stamp duty is paid, the same has been signed by the appellant. In this regard, it is also to be seen that within a span of 3 days, as to how the bank had got the property assessed/valued by its approved valuer, obtained the non encumbrance certificate from the authority concerned and also got it sanctioned from the competent authority of the bank in such short time, which also raises some doubt, but the Tribunal below has not considered these facts while passing the order impugned and has only given its finding that “it is not expected from an educated person to sign on blank forms”.

In view of the aforesaid, the order impugned is set aside against the appellant only and the case is remanded back to the Tribunal below to decide it afresh in accordance with law without being influenced by the observations made hereinabove after affording opportunity of hearing to the parties concerned. Accordingly, the appeal stands disposed off.

A copy of this judgment be forwarded to the parties as well as to the DRT concerned.